Aust govt must show tangible benefits of NBN

Kevin Noonan & David Kennedy/Ovum
16 Dec 2010

In the post-election carve-up, both sides of politics have assigned experienced ministers to lead the charge on communications policy, and both have nominated broadband as one of the key battlegrounds for winning or retaining government.

The task is not without significant challenges. Big infrastructure projects are notoriously difficult to manage and the business case is typically hard to justify.

The real challenge for the Labor Party is to dodge the claims of waste or mismanagement as broadband facilities roll out across Australia. Labor does have some history when it comes to project-management problems, and these memories are still very clear in the minds of voters. Opposition leader Tony Abbott has already said he will not be cutting any slack if there are signs of project delays or cost overruns.

In a practical sense, detailed financial debate about the business case is unlikely to make any practical difference in the long run. Calls for a wider cost/benefit analysis are also unlikely to make headway, simply because it is not possible to apply traditional cost/benefit techniques to such a far-reaching long-term project.

Nor is the telecommunications industry likely to complain. Indeed, the business sector frequently looks to government to provide all kinds of industry support through grants, subsidies, and concessions when free market forces are unable to do the heavy lifting.

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